How Steam and Android Will Change Gaming Forever

The next-generation hardware war is far more than just the typical three platforms duking it out. The big threats on the horizon? Valve and Google.

Last week, noted games-industry veteran and current Microsoft vice president Phil Harrison addressed the imminent chaos in the video game hardware space with typical charm and reverence. Two of his comments caught the eye of news editors and bloggers across the Web, and while they were both seemingly on-message and surely PR-approved, in truth they were quite contradictory. His first comment concerned the recent activity around potential new hardware platforms from companies other than Microsoft, Sony, and Nintendo: Valve's recent media escalation around its Steam Box initiative, the associated Xi3 Piston, and to a lesser extent other devices like Nvidia's Project Shield and the Kickstarted Ouya.

"Entering the hardware business is a really tough business…"

"I think that any new entrant, without being specific to any company or brand or product, any new entrant into the games industry is ultimately a good a thing," Harrison said, dishing out the kind of platitudes we've come to expect from the majority of games industry executives. We get it, Phil. You have to play nice before you try to scare people away. "Entering the hardware business is a really tough business, and you have to have great fortitude…and you have to have deep pockets and a very strong balance sheet," he continued. "It's not possible for every new hardware entrant to get to scale. They can be successful at small scale. But it's very rare for a new hardware entrant to get to scale, and I mean tens, hundreds of millions of units. There are a very small number of companies that can make that happen. And it's not just having a great brand or a great software experience. It's about having a supply chain and a distribution model and a manufacturing capacity and all the things that go with it. It's a non-trivial problem to solve, and it takes thousands of people to make [it a] reality."

He's right, of course, assuming your strategy is purely hardware based and focuses on creating a closed ecosystem with a retail box at the heart of it--like an Xbox or a PlayStation. Something proprietary that only one company can build and sell and that has an associated bureaucracy that exerts huge amounts of control over every aspect of the business.

When describing the future of Microsoft's own Xbox business, Harrison confirmed what many had assumed would be the company's strategy around games and entertainment in the coming years. He described what he called a transition from a "device-centric" business to something more service-oriented. "Everything we do will have increasingly deep social and additional features that are reliant on the network, enhanced by the network, and unlocked by the network," he said, adding that the company will be "moving from being creator of packaged products to being an operator of connected services."

And therein lies the contradiction. Services will define the next generation, not the hardware challenges he previously described. The box itself is increasingly little more than a vessel simply capable of running the services that users demand. A fast CPU, a good graphics processor, and something that can hook into the infrastructure, download the software, and talk to the controllers. Something that any hardware company already perfectly adept at building hardware at scale can produce, such as Samsung, LG, Dell, and Vizio, as well as smaller, boutique shops like Origin and Xi3.

In truth, the future of the Xbox (and the PlayStation too, if Sony is smart) will not differ from that of pretty much everything else in the space. The Valve vision for Steam is that it further evolves into a connected service that delivers entertainment to users wherever they want it. This latest development from the company demands a more controlled Linux-based environment than we currently see from the service, but that's less about Valve exerting its business muscle (though that's certainly an aspect) and more about it exerting control over the all-important user experience. By demanding specific Steam Box versions of software, it can ensure that the games are optimized for the environment in which they're played, and with the controls tweaked for the appropriate input device. If anything, the most important, proprietary, and contested part of the next-gen hardware war will be centered on controllers and input devices more than the processing power of the new boxes.

Still, this raises the question: Why is everyone else seemingly jumping on the Android bandwagon? In November 1996, Microsoft released the first version of its Windows CE platform, originally designed for the short-lived "handheld PC" market. Remember the iPaq? Yeah, stuff like that. It was always assumed that the "CE" in the platform's name stood for "Consumer Electronics," though representatives from the company have repeatedly denied this, offering up excruciatingly boring alternative definitions that we won't go into here. The ambition was for this new flavor of Windows to go beyond those handheld devices and power more specialized applications so that Microsoft's influence could extend far beyond the desktop. The vision was sound; it wouldn't be long before all devices would need some kind of software platform and a familiar environment for developers to work in, so what better than what was arguably the most familiar?

Since 1996, the platform has evolved considerably and now carries the crushingly dull name of "Windows Embedded Compact." It serves as the technical foundation for all manner of devices, including media players and in-car sound and navigation systems, plus it's also a very distant cousin of what eventually mutated into Windows Mobile. For gamers, the most interesting and highest-profile application came in 1999 with Sega's Dreamcast. Contrary to popular belief, the operating system didn't actually reside in the guts of the box itself, but the device was optimized for Windows CE and DirectX. A good number of games, such as Rainbow Six and Sega Rally 2, shipped with the operating system on the disc along with the game code.

Why the brief history lesson? It's important to understand that Microsoft was pretty far ahead of the curve back in 1996. The vision for CE had an awful lot in common with what Google is executing on today with Android: a common platform that provides a familiar environment so that developers can focus purely on delivering what they want.

For many gamers, discussion of anything Android-related no doubt provokes eye rolls and grumblings that it's not good for anything other than "crappy tablet games" like Angry Birds or Doodle Jump. Because of this, devices like the Ouya and Nvidia's Project Shield have immediately been dismissed for somehow trying to force casual touch-screen experiences onto gamers who demand much more. While that very well may continue to happen in the short term, it's important to understand what Android represents in terms of the bigger picture; it's an advanced, ever-evolving open platform with the support of one of the largest companies in the world. A company that is constantly iterating on feature sets and capabilities and offering developers the support they demand to build experiences for the platform. Much as handheld PCs were just the tip of the iceberg for Windows CE, so too are phones and tablets for Android. An Android device with sufficient processing power is perfectly capable of running Unreal-, OpenGL-, or Unity-powered games that look just as good as those running under Windows, or on an Xbox or PlayStation. Touch-screen devices are what pushed Android into our collective consciousness, but that doesn't mean that the platform is limited to the phone and tablet form factor.

In a world where services will be more important than anything else, Android-powered devices have the potential to provide the base from which any number of game-related services are launched. While the Steam Box is Linux-based, something similarly abled could be powered by Android and offer a powerful and open platform that scales to the capabilities of the device a game is running on. Playing on a powerful Android console? Then you get the full-on controller and HDTV experience. Logging in from your tablet? Then the game throttles back and adapts accordingly.

While the current thinking is that the battle for living room dominance is between the usual three contenders--Microsoft, Sony, and Nintendo, with new upstarts nibbling at the edges--we could very quickly see a shift toward a space increasingly dominated by two open digital platforms, each with numerous hardware partners. But where does that take the future of the platforms we currently love? They will need to increasingly lean into the areas where they are strongest: marketing, content discovery, and triple-A intellectual property. The next generations of the PlayStation and Xbox will likely find themselves in the same boat that Nintendo has been familiarizing itself with for some time: fewer, higher-quality triple-A experiences, and a greater emphasis on first-party games over third-party games.

We could be seeing the final transition to open source market. This means the likes of Steam will be released on who ever wants to make the devices to run it, and they will predominately be Linux based.

Heres what I see for the future that nobody has touched on...one of these days someone is going to wise up and integrate a computer into a tv. All our games, our internet, and our streaming movies will be through the tv. This is done to some degree now but if you want gaming performance you have to hook either a console or a desktop to the tv. Add to that someone needs to create a wireless keyboard and mouse that is responsive enough to handle the games so you can sit on your couch to do everything you would normally do at your computer. At that point I think consoles will be obsolete as will buying games and movies in stores. Everything will be available for download which of course you can transfer to your handheld device via a blue tooth or wi-fi from your tv. I could be wrong but this makes the most sense to me.

My favorite project right now is OUYA. I would soo much like to see it to succeed. The openness of it is something many have been waiting for quite a long time now. This very factor can boost creativity and new ideas in a quite large manner. It welcomes a lot of indie game devs with open arms. The Kickstarter was a giant hit and it has a lot yes a lot of potential! You can even open it up, hack it and do whatever you want without voiding the warranty!

A lot of people don't seem to know how much potential is hidden behind Android. Many have been looking down on Android since it started with phones, but just a few years later it's dominating the smart phone market. Those who never owned an Android device or don't know who XDA Developers are, usually don't have a clue how much more you can do with it then any other smart phone on the market mainly because it's much more open then its competitors. Of course Android had issues with game development because of the diversity of devices it supported but they are working a lot on it since Android 2.3 (Gingerbread) can as it is seen came quite far.

I buy the hardware that plays the games I want, I don't care what brand name is on the hardware. If there is 2 or more that do the job then I pick the one with the features that fit my life style. I always get the giggles when I see people fighting over brand name. Whats good for them isn't always good for others, of course they never seem to catch on to that.

Honestly, this industry has completely lost focus ha ha. All these new systems and new hardware, but at the end of the day it's about the software. You can have a NASA space super computer and if it only plays pong what's the point? If these systems develop a good library of games then it will start to come to together, otherwise it's just something else for people to spend money on.

This could actually be a good thing, more competition means good things for us gamers all around. Say valve comes out with a killer system and the games for it are great as well but they are like half the price, normally other systems will follow suit, or just from the gaming aspect of things this might make for some truly epic gaming all around, it means more creative minds working together to come up with fresh new ideas instead of the old part 1,2,3,4,5,6,7......... plus when something comes out that is truly revolutionary people love to expand on those same ideas, even if they are from other companies. So c'mon bring out some new systems and new ideas! breathe some fresh air into this stuffy area we call gaming I truly can't wait to see what comes of it.

I am a great believer in "hardware and software make the experience". I read and I hear as much as everyone about how everything is becoming virtualized, and service and experience should define the value, and I certainly support the idea.

But in real life, if you want to have a great feeling in a game, you have to have optimized it for the hardware. Or someone needs to have invested a ton of effort to make the hardware more transparent to you - like ATI and NVidia and DirectX have been doing for years on the PC. This does not come cheap with a slap of a finger.

Android developers are already complaining about devices disparity. And if you keep your ears open to slightly lower noise, you can hear i-things developers explain that having an app on all i-devices is not a given.

Apple made its breakthrough by executing flawlessly on the iPhone with hardware and software simultaneously (like it did for its first computers before). The same happened for the Wii.

If every supplier goes "virtual" and every hardware goes generic and non-differentiated, I am convinced that we have a mild gaming experience future in front of us.

So I think this market is about to re-consolidate itself sooner than later. Maybe 2 years from now at max, there won't be more than 2 successful network-based suppliers and 2 successful console-like suppliers. That is my bet.

if steam box and android dont have the power to run next gen graphics at 60fps, you can count me out... ill will stick with microsoft and playstation, and if even those cant push out the ability to run next gen at 60fps, which they should by this point, i will stick to the superior race in gaming... which is PC!!!

TBH I dont like this time when the new consoles are getting ready to coming out, if you are loaded then its great but if ya not ya just imagining having to spend loads on something that will be halfed in price in one years time... but it has to happen I guess.

1) Implement some version of WINE so we can run Windows games on Linux that don't have native Linux support.

2) I know it will never ever happen, but release a Steam client for the Wii U. It would be so awesome to have my 200+ games Steam library available on my new toy. I also think it would give Nintendo a much needed boost. I don't want to see my childhood game maker of choice disappear.

Lots of people saying digital copies wont work! If you have been paying attention for the last few years the market has grown, a lot! even shitty Game stop reported 40% digital sales increase.

I have been a long time game collector(since atari) I have my atari, nintendos(up till GC, the rest are meh) alll the game boys(no 3ds, meh as well) an various other systems. I dont ever want to get rid of them, but I hate lugging it around(if i move and such.)

with steam and, my digital copies all i have to do is log in! dont have to worry about scratching them, or some a-hole stealing them, or lending them out (dont forget i am a pc eletisit, i dont like to share ;)

They should have mentioned how Kickstarter is also changing how games are made. Because of it, no longer will developers be shackled by publisher restrictions. Instead of being forced to follow trends (i.e churning out COD clones, and sequels after sequels), they have room for creativity and freedom. Project Eternity, Star Citizen, Planetary Annihilation, Elite:Dangerous and all the others are a testament to that.

People have tendency to grow invested and attached to brands of long standing franchises. If Steambox doesn't get the support from some big studios, then it will require a leap of faith on part of the consumer to leave their comfort zone of established franchises and risk investing in new unproven ones.

The only way I see Microsoft winning the next gen is removing the online fee and release an incredible new hardware with a very very low price tag and many new features (this is also for Sony). In the next gen, any console that costs more than an equivalent PC is pointless also if we consider the new steam interface that makes PC gaming a more user friendly experience.

@abarteau I don't mean to rain on your "prediction" parade but the concept of a computer/TV combo is already what we have basically. Even mid-range level TVs have internet browsers, video streaming services, and other apps. My TV has WiFi and a USB port to plug in external storage so I can just absorb media right from the TV with no other inputs. Yet I still rather use my computer because it offers so much more just connecting it to my HDTV through HDMI.

All in one computers like the iMac or new Windows 8 all-in-ones are already a giant screen with a computer inside it. With higher resolutions than 1080p TV's provide at the moment. 2K and 4K sets are ridiculously priced whereas you can get a really nice all-in-one computer with a giant 30" touch screen.

The major problem with this, especially for PC gamers, is that it would be impractical for those that like to upgrade their systems on a regular basis to keep up with max graphics. To market computers as a console built into a TV where everyone has the same specs would be horrible, because then you're basically stuck with that TV. Could you imagine having to upgrade an entire TV/computer combo every few years? Some people like to upgrade their TV by itself.

Computers/consoles and television should ALWAYS be separate. Plus the only way that a PC could replace game consoles is if ONE COMPANY was dominant in the market and was able to create a machine that's upgradable with their parts and also has enough clout to bring on 1st party and 3rd party developers to create exclusive games or at least be respected enough for them to port blockbuster titles to the system.

The parts would need to be upgradeable but they would also need to be proprietary. So that the development and programming wouldn't require compatibility with 1000 different computer setups. They would only have to compensate for people switching between 1-3 graphics cards or 1-3 RAM configurations. Their proprietary parts would need to be easily replaceable by having some sort of new HOTSWAP PCI-E port design on a custom motherboard, so you can slide GFX cards and RAM in and out like with Hotswap drive bays.

The parts themselves could be normal parts but they built a custom enclosure that allows for them to easily just slide in and connect. This may not be necessary for expert PC users but the concept of a console is to make it simple for the common gamer or younger kids. The system would also need it's own controller of course too.

When you play PC games with a 360 controller the experience itself it identical to consoles except the graphics are WAY better. So I really wish they would just release every game for PC because we would get the FULL experience without all the compression of the textures they do in order to make it fit on outdated media like DVDs and blurays.

@abarteau Can't disagree more. Then you have to play all of your games on that TV. You can't move it to another tv in another room, you can't move it anywhere without bringing a 20 kilo tv along. what if just one aspect on the tv breaks. They have integrated internet into tv's and thats where they should stop.

@abarteau you're not wrong at all abarteau, having a computer as the your TV is genius and will most likely evolve into that because people would rather shop at home than go out doors forced to get long with his/hers fellow species, I understand...I really do. But people like to be able to customize their computers freely, adding RAM or switching graphics cards at anytime they choose without hassle, that's where Steam comes in hopefully enhancing our video game needs and their performance. A TV/Computer is a great idea especially everything ready to download and wireless connectivity with all sorts of devices, but there's going to be major flaws with the huge piece of hardware that would cost so much money to make let alone own. Still would be awesome to see someday if it's done right. I came up with a theory of my own that would also probably happen in the near future, in the way we consume media entertainment. The internet will take over television, it's already happening with Netflix and Hulu Plus, ect, where you get to choose what you want to watch instead of televisions spoonfed information power-house numbing my ability to think. Internet taking over television is good and bad here's why. Television is heavily censored and family friendly-ish right, but the Internet is open and free (well at least for now) and transforming it into television might cripple that liberty, which always seems to happen when we're too open and honest with things. What's great about those sites and providers is there's no advertisements being shoved down our throats, most people try to avoid them and can, but the problem is that's what television and the World Wide Web thrives on, advertising keeps them in business. Advertising and Marketing, the rapacious leaders of capitalism. Whatever is the most annoying to the masses will make the fat cats the most money, while China manufactures our clothes and toys. I just wish we could have our entertainment moderated, gadgets less glorified, and cheaper food, all without the expense of others suffering ...whoops wrong meeting.

@digitaltiger true that =/ cant blame xbox fanboys though when ps3 fanboys fight a dying battle as their console keeps getting horrible ports *sigh* but seriously i just think people need to grow up and stop being so defensive although best thing to do in the long run would be all 3 companys make one epic console then no one can complain and we get the best of all three worlds without the £1000 or more price tag lol but thatll never happen

@scamarot Agreed. I am no fanboy, i changed companies from the previous generation to this one, and if the valve system is good enough, I may even buy it instead of the new xbox or ps. Hope more companies jump into the hardware developing area, we NEED more competition. You are totally right.

@Klikandclick No way. Having too many game systems will force developers to spend more money on ports. Now, instead of nearly every game being on three consoles plus PC, there will be 3 plus these new devices plus PC. It's ridiculous. Exclusives are becoming more and more rare because spending tens of millions on a game that only runs on one machine is a tough gamble.

@ilantis You jus dont know what features they will add to the new consoles at this minute in time, I hope they make them with Wii like features on standard consoles, I'd like something extra that really pushs them into the next gen era.

And i love Ps3, the playstation plus is great, for £12 u get loads of games, you dont get that on pc or xbox 360, with the list changing every month, I'll be buying the new ps4 without a dout.

@ilantis The changes the console companies make, will not be from the point of view of the gamer, but from the point of view "how can we make the most money in the shortest period of time". As a result, I fear the next gen consoles will be a disappointment.

@Kaeban@scamarot I agree with the both of you. This is definately a good change for the gaming industry, and one I welcome with open arms. Honestly I've been so sick of the same old same old, companies copying other companies crappy ideas. But now that steam is stepping in, its going to force nintendo, sony and microsoft to actually step their game up and be creative instead of your usual call of duty titles and terrible reboot's.

@steve4123456789 I'd rather they do some HD remakes and/or sequels instead of disappearing (Skies of Arcadia HD and Gunvalkyrie HD or a sequel to either, even though that's wishing on a star, LOL.)

I agree with you on them making a new machine. I'd buy it, for sure. It would f*cking explode if they made a new console. So many SEGA fans would line up to buy that. The Sega Master System was my first console.

@Kabbalistica I think you missed the point. New and innovative game systems are striving to adopt common bases, such as android and linux, so that devs are able to focus more on the game and less on adapting it to fit a set of software requirements. If these other systems catch on, then the exact opposite of what you described will happen. The hardware wars will finally end, replaced by service wars and game wars. In any case, the gamer wins.

@ThAdEa82 @ilantis you can't resell you pc games. I buy a game for 60 And sell it for 40 and in the end is cost me 20c that's cheaper than pc games. I love pc games too. But I hate that pc gamers just make up BS why pc gamer are better.

@evilweav I'm an ex-programmer so I hear you, I really do and it does seem like that would have some advantages... Standardize everything so it's easier to make games for multiple systems/devices, which on the surface makes sense. But...

Might as well just get rid of all game devices by that logic then, get Microsoft, Sony, Nintendo, Nvidia, Valve (etc) to just all get together and make one, singular game company for both hardware and software. They could call themselves NWOG. New World Order Games, LOL.

@evilweav I do not think porting an android game to linux is easy. The main reason is that java-based games on linux do not rock because performance and API limitations, while native linux games would be in a different language, tough to port into Dalvik.

The similarities under the hood of these 2 platforms unfortunately does not make me feel like porting will be that easier.

@Kabbalistica I agree that more hardware platforms means a wider and thinner spread audience (and thus revenue opportunity), which could lead to what you said.